This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers, click the "Reprints" link at the bottom of any article.

April 25, 2013

Advisors Need Guidance on Rollover Resources

Having materials isn’t enough; advisors need to know how to use them with clients

The firms that most successfully address rollovers provide a mix of resources directed at advisors and their clients, according to the latest Mutual Fund Monitor from Corporate Insight. The research firm anticipates questions about rollovers will become more frequent as the job market improves and more clients begin dealing with new jobs and wondering what to do with old 401(k)s.

While many firms had strong marketing pieces that address rollovers, only a few had a “well-rounded” approach that incorporated client-ready and advisor-ready materials. The most notable firms were American Funds, Lord Abbett and Oppenheimer, Corporate Insight found.

The most common type of rollover materials were client brochures, which were offered by 71% of firms. Of the 43% of firms that offered client presentations in PDF or Power Point format, two-thirds included advisor scripts.

The report noted that just having resources isn’t enough; they should be easy to find. While 82% of the firms surveyed offer some sort of rollover materials, 36% point to them from the main page of the website. Just half promote them on their retirement resources page. Less than a quarter actively promote their rollover resources.

“We were surprised by the lack of promotion,” Jeff Latzer (left), head of mutual fund-advisor research for Corporate Insight, told AdvisorOne on Thursday. “Generally firms are strong in retirement promotion, but even when they’re talking about job changes, they’re not positioned heavily” to talk about rollovers.

Effective resources should answer clients’ most common questions clearly and prominently, Corporate Insight found. Charts that compare the benefits and drawbacks of various strategies should also be included.

Latzer noted one challenge for firms is understanding how to use the materials they do have.

“Some firms only put out one piece of literature or two, and it’s important to have that to take to clients, but more important is to have guidance for advisors on how to use [those resources,]” he said.

Latzer pointed out that talking about rollovers often means talking about something unpleasant: sudden unemployment.

“The industry calls it ‘job changes,’ but most of the time it’s losing a job,” Latzer said. “Issues within rollovers can be very important and very delicate topics. Advisors stand to benefit from more guidance.”